India looks to SAARC to resolve tariff tiff with Pak

Non-implementation of the tariff liberalisation programme by Pakistan under the South Asian Free Trade Area (SAFTA) from July 1, has now forced India to raise the matter at the level of the SAARC secretariat.

An urgent meeting of the SAFTA ministerial council to discuss the matter has also been sought.

"SAFTA has little operational meaning if Pakistan does not apply SAFTA to all the items except tariff lines in the sensitive list to all member countries," Commerce and Industry Minister Kamal Nath said in a letter to Chenkyab Dorji, secretary general of SAARC.

The minister pointed out that the notification by Pakistan on July 1 to reduce tariffs on imports of 4,872 items from the SAARC member countries clearly stated that "import of goods from India or goods of Indian origin shall be allowed according to the goods notified vide Appendix G. The Appendix G refers to the positive list consisting of 773 items."

Nath said in view of the serious impact that this decision of Pakistan's was likely to have on the implementation of the SAFTA agreement, the SAFTA ministerial council meeting should be convened urgently.

The SAFTA agreement signed by the member states of SAARC during the 12th summit in Islamabad in January 2004, became effective on January 1, 2006. It was agreed that the trade liberalisation programme under SAFTA would become operational from July 1, 2006.

Minister of State for Commerce Jairam Ramesh pointed out that a dispute resolution mechanism was not operational at the level of SAARC at present but hoped that it would be operational soon.

He said items like tea continued to face discrimination in Pakistan. "I hope that Pakistan will resolve its insistence to restrict its trade with India to the positive list ahead of the visit by a high level delegation from the tea sector to Pakistan," he said.

Commenting on the opening of the India-China trade through Nathu-La, Ramesh said the West Bengal government had requested the commerce ministry to involve them too in the trade rather than the benefits being restricted only to Sikkim.